Howard:
You state:
> I believe AOL is way overpriced but that may not stop it from going up another 50 points. For a mass market consumer company, a stock split may increase demand for stock from small investors, improving liquidity.
True, but in the final analysis it is always the revenue and earnings that will drive the stock price. With the $2 increase, let me go on record as saying that at least 20-30% of AOL subscribers will cancel and move to competittors such as EarthLink, AT&T, MSN, MCI, Sprint, etc.). Despite the fact that the subscription comes from subscribers credit cards I disagree with the notion that they do not mind the extra $2 increase.
Psychologically subscribers will be effected. Heck I am using AOL right now to post this, but have already subscribed for EarthLink and soon will be going to that. Not because of the $2 increase but rather the horrible busy line I get, not to mention the idiotic adds right after I log on to AOL, and the number of junk emails I receive.
My investment stratgey has always been not to ever short a stock, but I am very very close to start shorting AOL if the idiotic rise in the stock price continues. Although I know at the end I will not short it because it aint my investment style and I can not change that after 12-13 years of being in the market!
Regards,
Addi Jamshidi |
